Impact Of R&D Investment,Free Cash Flow And Capital Expenditures On Corporate Earnings In Russian Firms

The purpose of this paper is to analyze the impact of R&D investment,Free Cash Flow and Capital Expenditures on Corporate Earnings among Russian firms,and develop recommendations.Object of research are Russian public listed firms.Subject of research is Corporate Earnings and R&D investment's,Free Cash Flow's and Capital Expenditures' impact on Corporate Earnings in Russian public listed firms.From the result of our investigation we found that information R&D investment,Free Cash Flow and Capital Expenditures have significant positive effect on Corporate Earnings.Our finding fulfills the exist literature and contributes studying of innovation investment directly in emerging markets.In this study also use moderated regression analysis to examine the moderating role of Free Cash Flow in the relationship between R&D investment and Corporate Earnings.According to the moderated regression analysis,a higher level of Free Cash Flow increased the positive effect of Research and Development Intensity(RDI)on Return on Assets(ROA).Thus,the result from this investigation contributes the concept of Free Cash Flow as a resource for the organization to obtain earnings and sustain the firm's competitive advantage.We also confirm that Capital Expenditures have positive moderating effect on the relationship between R&D investment and Corporate Earnings,that mean if the firm has strong Capital Expenditures,it can help the firm reach the high level of Corporate Earnings during investment in innovation.The result of the presence of Capital Expenditures' moderating role is innovative and complements existing data on this topic.In addition to theoretical contribution,research also makes practical input.Based on made research the recommendations of improving Corporate Earnings are suggested and can be implemented by Russian public listed firms.Thus,spending money on R&D investment or capital investment through increased Free Cash Flow will increase the Corporate Earnings in prospect.Besides,we also discussed the importance of Free Cash Flow,innovations and firm's competitiveness and Earnings growth prospects.